What is a UTR number?
A UTR number is a unique identifier that is assigned to every taxpayer in the United Kingdom by HM Revenue and Customs (HMRC), the UK tax authority. It is a 10-digit number that is used to identify the taxpayer, so no business in the UK can operate without it. These rules do not differ from regulations in other European countries, however, attention must be paid to their specification within the UK.
How do you get a UTR number?
Taxpayers in the UK receive a UTR number automatically when they register as self-employed or set up a company. The tax authority then assigns a UTR number based on the details provided by the taxpayer in the registration forms. In this way, the company can be quickly identified for tax purposes and can carry out various types of commercial transactions.
What is the UTR number used for?
The UTR number is one of the most important elements in taxpayers’ relations with the tax authorities. It is used for a variety of purposes, such as filing tax returns, settling taxes, and providing information to the tax authority. Taxpayers are required to file an annual tax return, in which a UTR number is required. It is also required for tax returns relating to personal income, income from gainful employment or business profits. All correspondence and communication with HMRC relating to tax requires the UTR number to uniquely identify the taxpayer. Those setting up a business in the UK must also provide a UTR number when registering a company.
Validity of the UTR number
The UTR number remains permanent for a given taxpayer for the entire period of his or her tax activity. This is important in order to ensure continuity and consistency of tax data. In addition, it makes it easier for the tax authorities to track a trader’s tax history. So, the UTR number is an essential element in the UK tax system. Its uniqueness enables taxpayers to be identified effectively and for tax affairs to be conducted transparently and efficiently. For each taxpayer, it is a specific identification number that plays a key role in all interactions with the tax authorities.
Partnership with an external tax firm
Given the frequent changes in tax legislation, it is worth considering working with a tax office specialized in helping companies grow their business. This allows you to focus on the main purpose of your business, rather than acquiring knowledge about correct tax returns. This is important from the point of view of both start-ups and companies looking for new customer groups. In this way, the company will not incur excessive costs, regardless of the products and services offered in the market.
